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Government achieves macro-economic stability

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Accra, Dec. 5, GNA - Dr Akoto Osei, a Deputy Minister of Finance, on Monday said the Government had succeeded in achieving macro economic stability and accelerated financial sector reforms needed to jump-start the growth of the private sector.

He said that besides the stability in the value of the currency, interest rates were now within manageable limits for business, with Government reducing its public sector borrowing from the banks to enable them to redirect the much-needed capital to the private sector. Additionally, financial market infrastructure deepening including the issue of medium term bonds and the operation of the Central Settlement and Depository System were in place to enhance efficiency in this direction.

Dr Osei said this at the launch of the 10th anniversary celebration of the First Atlantic Merchant Bank (FAMB) in Accra.

He said vital laws had been passed to strengthen the transparency and integrity of the banking sector including the Payment System Bill, the Long Term Savings Bill and the Venture Capital Fund Bill. The Deputy Minister said that notwithstanding these gains, the Government would continue in the coming years to improve its macro-economic management and orient its policy toward a level playing field for providers of financial services and investment.

However, these achievements could not have been attained if the financial institutions had not supported these activities. He said as partners, the banks should continue to help by lowering and eliminating avoidable transaction cost to the business community, increase its credit to industry, expand and deepen financial services delivery especially to the rural economy through continuous innovative and cost effective payment system and expansion in branch network. Government, he said, would continue to implement its financial sector reform to ensure the attainment of Ghana's vision for the financial sector, which is "a financial sector that is efficient in the mobilization and allocation of funds, fully integrated with the global financial system and supported by an effective regulatory system that promotes a high degree of confidence".

He commended the FAMB for its 10 years of operation and expressed the hope that the institution would come out with more innovative products to make it a Bank of choice in a fairly competitive environment.

Mr Jude Arthur, Managing Director of the FAMB, said the Banks efforts at supporting the strategic initiatives put in place by the Government aimed at invigorating the economy through the privatisation of key economic sectors and the provision of the appropriate support for identified strategic sectors had yielded fruits. He said that as far back as 1997 the Bank played an important role in the privatisation of the GIHOC Pharmaceuticals and the eventual sale to Phyto Ryker.

The Bank since then, he said, had been a key player in the Governments' divesture programme and had provided expert advice on privatisation to both government and private sector participants in the programme.

Mr Arthur said the Bank's commitment to the privatisation process had led it to develop its capacity in key areas, enabling it to play a major role through the provision of advisory and financial support towards private sector participation in Government's programmes. He said the FAMB was playing an important role in privatising various aspects of port activity aimed at making the Ghana Ports and Harbours Authority a landlord and regulator of the Tema Port. Mr Arthur announced that the Bank had just finalized the syndication of a 15.5 million-dollar loan for the development of facilities at the Tema Port as part of its ongoing involvement in the sector.

He said the outstanding growth in port activities over the last few years had come as a direct result of the Government's strategy of private sector participation in its programmes.

He said the Bank had this year issued Letters of Credit totalling 75 million dollars to support petroleum imports through syndications and collaborations with other local banks.

The Bank, he said, had put together a syndicate for seven million dollars, which is financing the implementation of river barges transportation system to facilitate the delivery of petroleum products to the northern parts of Ghana.

The success of these collaborations would contribute to the Government's efforts to stabilize the economy by ensuring that critical products from the petroleum industry were distributed in an efficient manner.

Mr Arthur said the Bank's initiative in the petroleum industry were to be replicated in other sectors in the bid to bring together syndicates of local financial institutions to collectively harness their resources to support key initiatives in the private sector. He said it was the Bank's belief that co-operation between local banks was critical in the banking industry to position itself to support Government's economic strategy of private sector growth. FAMB was incorporated as a business on May 4th 1994 and received its banking licence in August 1995. It was formally inaugurated in November 1995.

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